Cooper Tire's (CTB) Q4 Earnings, Revenues Miss Estimates

Cooper Tire & Rubber Co. (NYSE:CTB) posted adjusted earnings of 50 cents per share in the fourth quarter of 2017, missing the Zacks Consensus Estimate of 62 cents.

Cooper Tire registered net sales of $757 million, missing the Zacks Consensus Estimate of $770 million in comparison with the year-ago revenues of $784 million.

Operating profit was $47 million in the fourth quarter of 2017, down 55.4% from the year-ago quarter.

Segment Details

Americas Tire Operations registered a 7.1% decrease in net sales to $645 million. Operating profit in this segment declined 47.8% to $61 million while operating margin decreased from 16.8% to 9.4%.

International Tire Operations registered a 30.5% rise in revenues to $162 million. Operating profit came in at $6 million, increasing from $1 million in the year-ago quarter. Operating margin rose to 3.7% from 1.1% in the year-ago quarter.

Financial Position

Cooper Tire had cash and cash equivalents of $371.7 million as of Dec 31, 2017, down from $504.4 million as of Dec 31, 2016. Capital expenditures increased to $54 million in the fourth quarter of 2017 from $49 million in the year-ago quarter.

Share Repurchases

In February 2017, Cooper Tire increased the share repurchase amount by $300 million and extended it til December 2019. During the fourth quarter of 2017, the company spent $20.7 million on repurchasing 576,242 shares at a price of $35.87 per share. Since August 2014 through Dec 31, 2017, Cooper Tire has brought back a total of 14.8 million shares at an average price of $34.42 per share.

Outlook

Cooper Tire expects operating margin for full-year 2018 to be at the low end of 9-11%. For 2018, capital expenditures are still expected between $215 and $235 million. The effective tax rate for the year is expected to be 23-26%.

Cooper Tire currently has a Zacks Rank #2 (Buy).

Some better-ranked companies in the auto space are General Motors Company (NYSE:GM) , Daimler AG (OTC:DDAIF) and Lear Corp. (NYSE:LEA) . While General Motors sports a Zacks Rank #1 (Strong Buy), both Daimler and Lear carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.

General Motors has an expected long-term growth rate of 8.4%.

Daimler has an expected long-term growth rate of 5%.

Lear has an expected long-term growth rate of 7.1%.

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